Professional predictions: What will CX look like in 2023?

As we approach the final few weeks of 2022, it isn’t too much of a stretch to suggest that most people won’t be sorry to see the back of it.

Whilst we are all sick to the back teeth of hearing about the unprecedented times that we’re currently living through, there is no denying that it has been another turbulent 12 months of hardship and chaos – indeed, some may even call it unprecedented.

From the aftermath of the pandemic, to Russia’s invasion of Ukraine, to the cost-of-living crisis – there has been no shortage of bad news in 2022. And these catastrophes have certainly taken their toll on the CX sector.

Customer loyalty and trust has plummeted, with shortages and supply chain issues also leading to record levels of customer complaints, as customer service employees continued to bear the brunt of peoples’ frustrations.

Elsewhere, ‘The Great Resignation’ ended up being more of a minor resignation, with quiet quitting proving to be a larger concern for leaders and managers.

With the chaos of the last 12 months, you’d need to be a brave person to make any forecasts for next year. Fortunately, we’ve found plenty of experienced professionals who are willing to put their reputations on the line and predict what fresh trends, technologies, and opportunities 2023 will have in store for CX.

Lets just hope no one predicts any more unprecedented events!

The cost-of-living crisis will continue to change customer behaviour – but how?

With the cost-of-living crisis set to continue and potentially worsen heading into 2023, it will undoubtedly have an impact on the CX sector.

Predicting that it will lead to a change in customer behaviour seems like a fairly safe assumption, but predicting precisely how this change will look is a much tougher proposition.

As Forrester so eloquently puts it:

“2023 will be a jumble of mixed signals, reflecting a unique environment characterised by opposing forces: exuberance as the pandemic wanes, tempered by caution in the face of economic turbulence.”

Sue Duris, an experienced customer experience and marketing leader, also believes that consumers will be more cautious with their money in 2023:

“The cost of living situation in the UK (and US) is making consumers and organisations re-think costs, so it is incumbent on CX teams to ensure they and their CX programmes are delivering value and continuously improving to deliver even more value.

“How do we add value? There is strength in numbers. Coaching other employees about the value of CX and more specifically, how they help to move the needle on it on their own teams and their organisation as a whole; and helping employees, volunteering to participate on projects to add the customer-centric point of view.”

'Businesses need to double down on providing joined-up customer experiences through savvy data consolidation.'

The increase in customer expectations that Sue predicts, is also mentioned by Rita Martins, CRM Lead at Ometria, who sees employee experience as crucial in 2023:

“Businesses need to double down on providing joined-up customer experiences through savvy data consolidation, analysis and actioning. In 2023, stressed out customers will be harsh on businesses that bother them with under-relevant over-communication. It’s now critical that every interaction is streamlined and personal to the interests of the consumer.”

Organisations will need to start placing a greater focus on customer listening and feedback

Listening to customers and acting on their feedback may seem like CX 101, but it is so often overlooked and under-prioritised.

Colin Crowley, a CX advisor at Freshworks, believes that 2023 will not only see an increase in the importance of customer feedback, but a change in customer feedback altogether, due to AI-powered surveys:

“We’ll see attention shift beyond simply delivering strong customer experiences, to how well each of those experiences are perceived by the consumer. Thanks to AI and a wealth of rich chat, SMS and WhatsApp messages showing the cadence of customer and agent conversations, as opposed to stop/start email interactions, organisations will get smarter and more sophisticated feedback.

“AI-powered surveys that dynamically morph to get maximum feedback from customers based on prior responses, will reshape the customer feedback game and textual analysis will be able to pull together a much more integrated sense of how customers feel.”

Like Crowley, Cormac Kelly, senior director of customer success at Momentive, believes that technology improvements will lead to greater access to customer feedback. However, as with any changes/developments to existing systems, he also believes that it will pose some problems:

“With an increase in touchpoints, companies can now access the voice and opinions of a variety of different customers with whom they weren't previously connected. However, with this influx has come the challenge of distilling high volumes of feedback which puts a strain on their CX teams.”

Founder and CEO of Authenticx, Amy Brown, also has reservations about technological changes to feedback systems:

“Companies throwing technology at their staffing shortfalls – without first understanding the problem they’re solving for and how it actually impacts the customer experience – will be an utter failure. Spending millions of dollars on the latest digital innovation or optimisation transformation won’t solve the patient experience and will ultimately hurt the company’s business.

'Companies throwing technology at their staffing shortfalls – without first understanding the problem they’re solving for and how it actually impacts the customer experience – will be an utter failure.'

"Leaders must use technology to listen at scale to patients and know how and when to enable digital solutions and the staff they do have to do their best work.”

This argument is supported by Brown’s fellow Authenticx employee and current CCO, Leslie Pagel:

“AI and ML are continually evolving and advancing to support conversational analysis, but it’s a myth that they’re a silver bullet. Machines can play chess and drive cars because there is a finite number of moves. Conversations are infinite and enlightened leaders recognise the inherent challenges this presents to AI and machine learning.

“They will realise that the best way to understand and harness the value of conversation analysis, as it exists today, is to combine ML, AI and human understanding.”

Organisations will expect more sophisticated customer data collection and integration systems

Arguably the area most mentioned by our CX forecasters was customer data, with it acting as the focal point for several of the trends expected for next year.

Whilst by now we are all well aware that companies have access to more customer data than ever before, being able to use that data to improve customer insights and understanding will be paramount in 2023.

Ben Hookway of Relative Insight gives his thoughts on how companies can go about achieving this:

“Businesses are constantly presented with an overflow of information which can be difficult to manage, but all of this qualitative text data can – and should – have strategic influence on brand strategy, product development, customer care, marketing, communications, and more. But it can be used only if brands and insights professionals have efficient, robust ways to analyse it.

“Rather than data being siloed and analysed for a single purpose, businesses can release the potential of customer-driven insights and collaborate with other departments. Similarly, the approach used to generate competitor intelligence may also prove useful for generating local market insights for global companies. Quite simply, knowing how to find unique insights and to make the most of data assets has never been more important.”

'Quite simply, knowing how to find unique insights and to make the most of data assets has never been more important.'

The need to revitalise existing customer data strategies in order to unlock the full potential of customer information, is a concept that was explored in a recent Harvard Business review survey.

The study found that virtually all (99%) of the respondents considered the integration of customer data into their business processes to be very/extremely important, yet only 2% believed that their organisation did so extremely successfully, and only 17% very successfully.

The report strongly puts forth the virtues of centralised data models, with the bulk of those surveyed clearly believing that they will play a big part in the future of CX data usage.

Ari Lightman, professor of digital media and marketing at Carnegie Mellon University in Pittsburgh, sums up the argument nicely:

“A centralised data model is critical – it provides greater efficiencies, less risk, and greater levels of normalisation. Without a centralised data model, companies are unable to capture the demand and constant changes in customer needs”.

Whilst not strictly referencing centralised data models, Kelly also believes that 2023 will see organisations incorporating more sophisticated technology to help with data collection and integration:

“In 2023 I predict we will see industry professionals dedicate CX budget to technologies and solutions that can collect data effortlessly. They will look to technologies like AI and sentiment analysis that can analyse customer feedback from existing, new, and still yet undiscovered entry points. These tools will produce trends that can be used by the CX teams to make customer impacting decisions in a faster, more efficient manner."

You’ve got the data, now what are you gonna do with it? 

We did say it was a popular topic.

If the last prediction was about organisations being able to better collect, analyse, and integrate data – this one is about maximising how they use the data.

For Leslie Pagel, one of the more overlooked areas of data usage and one that she believes will grown in prominence in 2023, is harnessing the power of customer interactions:

“If companies want to maximise the data they have in 2023 and beyond, they need to help their team become effective data-backed storytellers. Companies today focus on the analytic and listening side but they’re missing the other piece of it – connecting the customer to the people within the business.

“Companies are starting to realise they’re ignoring the most valuable source of customer insights – the interactions they have with customers every day. They’re ignoring customer conversations because they believe their NPS scores and survey data represent the voice of the customer.

“But some haven’t realised that the literal voice of the customer is already in their walls and the technology exists to harness this data. Those who have ventured down the path of harnessing their customer interaction data recognise a value that is exponentially greater than the survey data they have relied on for decades.”

Another highly popular topic discussed by our CX soothsayers was the continued rise of the importance and influence of AI – something that was particularly pertinent to data usage.

Alice Chang, CEO and founder of Perfect Corp, was especially adamant about the role AI will play in the retail sector in 2023, and how it will work alongside customer data to help create more personalised experiences:

“In 2023, brands and retailers seeking to create stronger customer experiences will need to consider how they can leverage technology to provide customers with immersive shopping experiences. Today, consumers are demanding personalised advice when shopping online and in-store. AI + AR technologies, such as virtual try-on, will be necessary to elevate the consumer experience and ensure that each customer interaction is tailored to the customer’s unique needs.

'AI + AR technologies, such as virtual try-on, will be necessary to elevate the consumer experience and ensure that each customer interaction is tailored to the customer’s unique needs.'

“2023 will be a year where the world of retail continues to transform, bringing digital transformation to the forefront of the consumer experiences in exciting new ways. AI and AR will be at the centre of these experiences, helping to provide each customer with an immersive and personalised shopping journey.”

The ability of AI to enhance customer personalisation was also discusses by Liam Patterson, CEO of Bidnamic:

“Consumers of all ages are being influenced by brands across a plethora of platforms, notably TikTok and Instagram. The data generated by these campaigns will help brands understand consumers and drive sales, and help create a personalised customer experience across the funnel. Not only will this build customer loyalty and retention, but also help to understand a wider customer base. AI will be at the forefront in helping retailers crunch the data and maintain margins during a recession.”

However, Darren Rushworth, international president of NICE, sees AI’s biggest impact coming in the digital experiences and self-help sector:

“Very few businesses today are offering an experience that empowers customers to effectively self-help through any digital channel. To do this, UK businesses must look to cloud-native, AI-powered solutions that can help them not only deliver insights but transform data into automated actions that empower businesses to manage customer intent before it becomes a need, in real-time. Only then can a business meet a customer at the start of their journey – be that search, social or website – and allow them to easily find the right answers on the channel of choice.

“Better still, with the right tool businesses can deliver personalised chatbots that act more like a smart assistant, which understands each customer’s preferred communication style and when it is best to proactively reach out with information.”

Customers will want to see exactly how their data is being used, and will expect to share the benefits

In the third and final instalment of our CX data predictions section, our experts outlined the need for organisations to be open and transparent with their data usage so that both company and customer can benefit.

Raj De Datta, CEO and co-founder of Bloomreach, discusses this need to find a middle ground between utilising data to provide better, personalised experiences, and ensuring that businesses are unambiguous in their data usage policies:

“Of course, data plays an important role in driving personalisation – the heart of truly incredible customer experiences – so to adopt strong data practices doesn’t mean to abandon it altogether. To strike this balance, brands must champion transparency and make it absolutely clear how they use people’s data, and we’ll begin to see more of that in the coming year.

“77% of consumers say that transparent data practices impact their purchasing decisions, with more customers consciously trying to purchase products from brands prioritising data transparency. Using simple strategies such as, “these items are here because you marked them as favourites”, helps build customer trust by showing them how the company has used its data meaningfully. Above all, data collection is a two-way street: in exchange for the information your customers give you, you need to provide greater value in return.

'77% of consumers say that transparent data practices impact their purchasing decisions.'

“This value is generated through the personalisation that data drives, and its ability to show the right customer the right product at the right time. For years this has been an unfulfilled promise of brands, but it feels businesses are now beginning to adopt the right technology and practices to enable it. As a result, we can expect to start seeing better digital experiences for customers, and ultimately, more e-commerce revenue for businesses.”

Ben Richards, chief experience officer at VMLY&R, also believes that organisations will come under greater pressure to be more transparent with their customer data policies in 2023:

“Brands have never had such high expectations from consumers to behave ethically and responsibly, and this doesn’t stop when it comes to their CX. We will see more brands making shifts around accessibility, sustainability and social impact in the year ahead, and well past that too. Whether that’s adding audio descriptors across websites, providing clarity around supply chains, or ensuring your plug in partners are not driving your customers into debt – brands will be held more accountable for providing transparent ‘customer first’ CX strategies.

“In the UK, the FCA (Financial Conduct Authority) is one of the first to step in the right direction, introducing regulations that will see senior bosses at city firms facing fines and having their bonuses docked if they fail to put consumer needs first. We will see far more of this begin to ripple through businesses and those making the early necessary shifts in strategy will be the ones to measure up against in the long term.”

Sustainability will become more important than ever

Our penultimate prediction is another that probably won’t surprise too many people.

With climate change still very much being considered the biggest issue of our time,  more and more customers are looking to their brands to show environmental and societal awareness, and boycotting those that don’t.

Michael Chadwick, head of strategy and experience at Cheil UK, believes that these customer expectations will lead to many organisations prioritising sustainability next year:

“In 2022, we have continued to see sustainability rise up the agenda for the majority of businesses – and become a more and more important part of the purchase decision-making process for many consumers, especially younger ones. In 2023 sustainability will become even more core to the CX conversation.

"Consumers increasingly want transparency around sustainability across every interaction they have with a brand – and as such, the topic needs to become central to the design of every CX journey. Building a sustainable supply-chain and business model is a critical first-half of the equation, but the second-half is just as important: how do you bake that sustainability into the customer’s experience?

"Critically, consumers also want to see sustainability and circular economy principles built into the customer service proposition of the brands they buy from. Repair, recycling, and refurbishment will become key words for many businesses – in the midst of a cost-of-living crisis, consumers will want to see how businesses can help them get more out of their purchases, and will value and reward the organisations that do just that.

'In 2023 sustainability will become even more core to the CX conversation.'

"A great example of this is B.I.L.L (Bot Initiated Longevity Lab), Nike’s recently launched robotic sneaker repair solution, that helps consumers get more out of their Nikes using smart in-store tech. People will gravitate towards brands which offer solutions that reduce environmental impact and are easier on their wallet – and ultimately reward those brands with more custom. In a tightening consumer environment, investment in tech that supports sustainability and helps customers navigate the tough economic landscape looks like a win-win from a CX perspective."

The importance of brands providing sustainable solutions and programmes is echoed by Alice Chang, who again sees AI playing a serious role in this regard:

“In the year ahead, AI and AR technology will also begin to play a more significant role in brands’ sustainability agendas, as shoppers begin to prioritise eco-friendly business practices and reducing product waste.

“With AI and AR technology, brands can create sustainable product testing environments, allowing customers to try on and experiment with many products through virtual try on technology. This allows brands to create powerful and engaging try-on experiences, without the need for any physical product testing. This technology ultimately helps customers find their perfect product fit, allowing brands to reduce product waste and decreasing waste created from product returns.”

Will IT leaders start becoming CX leaders?

Our final offering may be more speculation than prediction, but with a few of our experts referencing the possibility, we felt that it was definitely worth mentioning.

Whilst many of the above predictions have discussed technology in some way or another, for many CX professionals, incorporating new tech can be more hassle than it’s worth.

In a survey of 100 CX leaders conducted by MyCustomer in partnership with the European CX Organisation (ECXO), technology was revealed as one of the biggest obstacles to successful CX programmes, with roughly a third of respondents flagging it as an issue.

So why do technology and CX struggle to gel so often, and will the incorporation of IT leaders into the profession remedy the problem?

For Sue Duris, the fault lies with both sides:

“Either IT leaders need to be open to customer-centricity or have some exposure to CX, or CX leaders and IT leaders need to co-create. I’m of the opinion that CX and IT should work hand-in-hand to align on data and technology. If CX and IT can’t come together, a big data and technology gap will form, and a 360°customer view must be present to drive a sound CX.”

Richard Green, chief technology officer at SugarCRM, is also of the opinion that IT and CX need to start becoming more intertwined, arguing that CIOs should start moving into CCO positions:

“I believe that CIOs must slide seamlessly into the new role as chief customer officer (CCO), ensuring they protect brand reputation and loyalty by delivering on marketing and service productivity and efficiency – always putting the customers’ needs first. So, how does a CIO achieve this?

“Digital transformation, staying ahead of competitors and technology, and fulfilling customer expectations with a streamlined experience are the holy trinity for a CIO in their pursuit of becoming a successful chief customer officer.

“Removing the administrative burden placed on sales, marketing and service teams, embracing technologies that make high-definition customer experience possible, and eradicating data silos are the key steps in a seamless transition from CIO to CCO.

“In a fast-changing business environment, it is fundamental that CIOs examine trends and embrace digital transformation to successfully stay ahead of the competition and future-proof their company.”